The Wall Street Journal (paywall):
On Wednesday the retailer said it would open its free two-day shipping program to any U.S. customer, an expansion of the $49 per-year service designed to grab shoppers from Amazon’s popular $99 a year Prime program. Until now Wal-Mart allowed only a limited and undisclosed number of shoppers to sign up. (…)
To get ready, the retailer has shifted more inventory to seven massive online warehouses around the U.S. and signed partnerships with smaller regional carriers to deliver more of its packages. A Wal-Mart spokesman says that ShippingPass is still a “pilot” that could change, and that only products sold directly by Wal-Mart are currently eligible for free shipping under the service.
ShippingPass is cheaper than Amazon Prime, but it also ‘only’ provides fast shipment. That almost certainly won’t be enough to make ShippingPass a success. Fast shipping is a hygiene factor, not a conversion driver.
We talked a few weeks ago about this:
Compare what can kind of products can be put inside a bundle called “ShippingPass” to what can be put inside a bundle called “Prime”. The naming alone reveals how little strategic value Wal-Mart seems to be putting behind the notion of making a bundle going across multiple categories; you know, like Amazon Prime, the one they wan to fight head-on with this. (Even with comparable shipping times, item prices and user experience -all big ifs-, a smaller fee will almost certainly not be enough against an established Amazon Prime. Amazon’s growing library of exklusive Prime Video content alone will see to that. That’s called asymmetric competition, by the way.)
Giving away a free 30-day trial of ShippingPass now, a few days before the second annually Amazon Prime Day (12th of July), is like a declaration of war by Walmart. How ShippingPass is going to expand over the next 30 days will be very illuminating.
Walmart is also constantly expanding its marketplace. WSJ:
Executives have said its website now has about 10 million products compared with about 120,000 items available in the average Supercenter. By comparison, Amazon.com has hundreds of millions of products.
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